The Markit Flash Eurozone Manufacturing PMI rose from 56.2 in March to 56.8 in April, its fastest rate since April 2011. While there continues to be a lot of political uncertainty on the continent, survey respondents in the sector have mostly brushed aside such concerns. Instead, they have focused on the fact that the Eurozone economy has trended generally in the right direction in recent months, with activity accelerating at a modest rate, and the headline PMI has trended higher since bottoming out at 51.2 in February 2016. Despite an election in France this weekend that could be quite consequential, depending on the results, manufacturing activity in that country (up from 53.3 to 55.1) accelerated to its fastest rate since April 2011, helping to lift the Eurozone data. At the same time, Germany (down from 58.3 to 58.2) edged slightly lower from its six-year high in April, but remained quite strong.
The underlying Eurozone data in April were higher across-the-board, including new orders (up from 57.1 to 57.6), output (up from 57.5 to 58.0), exports (up from 56.7 to 57.5) and employment (up from 55.1 to 55.8). As such, demand and production both grew at paces not seen in six years. Likewise, the index for future output (up from 66.6 to 66.9) bounced back to January’s pace, which had been the highest level since the survey was introduced in mid-2012.
Meanwhile, the Markit Flash U.S. Manufacturing PMI eased to its slowest growth rate since September, down from 53.3 in March to 52.8 in April. It was the third straight monthly decline, down from 55.0 in January, which was the fastest growth rate in nearly two years. Nonetheless, we continue to see modest growth overall in the sector nationally, even with some easing for both new orders (down from 55.0 to 53.7) and output (down from 54.4 to 53.4). The data also showed some encouraging signs, including increases in the expansions for exports (up from 51.4 to 52.1) and employment (up from 51.4 to 52.5). Looking ahead 12 months, manufacturers in the United States continued to be optimistic about future output (up from 65.7 to 65.9).
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